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TMI Blog2018 (9) TMI 2011X X X X Extracts X X X X X X X X Extracts X X X X ..... eld that section 201(3), as amended by Finance Act No.2 of 2014 shall not be applicable retrospectively and therefore, no order under section 201(1) of the Act can be passed for which limitation had already expired prior to amendment to section 201(3) by Finance Act No.2 of 2014. It is not in dispute before us that the proceedings u/s.201(1) of the Act were barred by time if the law applicable for the relevant period is the law as it prevailed prior to amendment to Sec.201(3) by the finance Act No.2 of 2014. In these circumstances, we find no error in the order of the CIT(A) in holding that the orders passed for FY 2008-09 to 2010-11 were barred by limitation and consequently quashing them. We find no grounds to interfere with the order of the CIT(A) and therefore dismiss the appeals by the revenue. - ITA Nos. 2570 to 2572/Bang/2017, CO Nos. 51 to 53/Bang/2018 - - - Dated:- 14-9-2018 - SHRI N.V. VASUDEVAN AND SHRI INTURI RAMA RAO, JJ. APPELLANT: Smt. Padmameenakshi, Jt.CIT(DR)(ITAT), Bengaluru RESPONDENT: Shri Manju Prasad L. ORDER N.V. Vasudevan, J ITA Nos.2570 to 2572/Bang/2017 are appeals by the Revenue against a common order dated 28.9.2017 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng fails to pay the tax as required by or under this Act, he or it shall be liable to pay simple interest at one per cent for every month or part of a month on the amount of such tax from the date on which such tax was deductible to the date on which such tax is actually paid and such interest shall be paid before furnishing the statement in accordance with the provisions of subsection (3) of section 200]. 4. There was no period of limitation for passing order treating a person as an Assessee in default u/s.201(1) of the Act and for levying interest on non-deposit of tax not deducted at source or deducted but not paid to the credit of the Central Government Account, u/s.201(1A) of the Act. A period of limitation was introduced for the first time by the Finance Act, 2009. The following sub-sections (3) was inserted after sub-section (2) of section 201 by the Finance (No. 2) Act, 2009, w.e.f. 1-4-2010 :- (3) No order shall be made under sub-section (1) deeming a person to be an assessee in default for failure to deduct the whole or any part of the tax from a person resident in India, at any time after the expiry of- (i ) two years from the end of the financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessee pointed out that the time limit for passing an order u/s.201(1) 201(1A) of the Act for the FYs 08-09 to 10-11 would be 2 years from the end of the relevant FY as per 201(3)(i) of the Act, would expire two years from the end of the financial year in which the statement is filed in a case where the statement referred to in section 200 has been filed. The show cause notice issued by the AO dated 8.2.2016 was invalid as the time limit for passing orders for the relevant FYs u/s.201(1) 201(1A) of the Act had already expired. 8. The respondent vide its orders dated 30.3.2016 for all the three FYs held that the substituted provisions of Sec.201(3) substituted by the Finance (No. 2) Act, 2014, w.e.f. 1-10-2014, referred to in paragraph-5 would apply to the case of the Assessee and therefore the proceedings u/s.201(1) 201(1A) of the Act are not barred by time and that the AO would have a period of 7 years from the end of the relevant financial year in which there was default to comply with the relevant provisions of law relating to tax deduction at source. The Assessee had contended before the AO that there was no default u/s.201(1) of the Act and consequently no order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atement referred to in section 200 has been filed; (ii ) in any other case. There was no third category of case where a statement referred to in Sec.200 is filed belatedly. The argument of the revenue as put forth in the grounds of appeal is therefore devoid of any merit. 12. As far as the question whether, section 201(3) as amended by Finance Act (No.2) 2014 would be applicable retrospectively or not, the Hon ble Gujarat High Court in the case of TATA teleservices Vs. Union of India and Special Civil Application Nos. 1623, 2115 and 4771 of 2015 Judgement dated 16/02/2016, relating to Assessment Year 2008-09 took the view that section 201(3), as amended by Finance Act No.2 of 2014 shall not be applicable retrospectively and therefore, no order under section 201(1) of the Act can be passed for which limitation had already expired, prior to amended section 201(3) as amended by Finance Act No.2 of 2014. The facts of the case before the Hon ble Gujarat High Court was that the petitioner was engaged in the business of providing telecommunication services and selling service products across the country. According to the petitioner, it is governed by Tele-Communication Interconnecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e aforesaid decisions, the Hon ble Gujarat High Court held that the facts of the case before it and more particularly considering the fact that while amending section 201 by Finance Act, 2014, it has been specifically mentioned that the same shall be applicable w.e.f. 1/10/2014 and even considering the fact that proceedings for F.Y. 2007-08 and 2008-09 had become time barred and/or for the aforesaid financial years, limitation under section 201(3)(i) of the Act had already expired on 31/3/2011 and 31/3/2012, respectively, much prior to the amendment in section 201 as amended by Finance Act, 2014 and therefore, as such a right has been accrued in favour of the assessee and considering the fact that wherever legislature wanted to give retrospective effect so specifically provided while amending section 201(3)(ii) of the Act as was amended by Finance Act, 2012 with retrospective effect from 1/4/2010, it is to be held that section 201(3), as amended by Finance Act No.2 of 2014 shall not be applicable retrospectively and therefore, no order under section 201(1) of the Act can be passed for which limitation had already expired prior to amendment to section 201(3) by Finance Act No.2 of 2 ..... 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